Morumbi Oil and Gas Inc.

Morumbi Oil and Gas Inc.

May 18, 2011 07:00 ET

Morumbi to Start Exploration in Papua New Guinea Following the Acquisition of Rockwell Exploration S.A.

- Rockwell Subsidiary to Explore and Develop Hydrocarbon and Mineral Resources in PNG

- Rockwell to Be First Mover Into Bougainville

CALGARY, ALBERTA--(Marketwire - May 18, 2011) - Morumbi Oil & Gas Inc. (TSX VENTURE:MOC) ("Morumbi" or the "Company") announces that further to its acquisition of Rockwell Exploration S.A. ("Rockwell") (see Press Release March 25, 2011) it is preparing an exploration program in Papua New Guinean ("PNG") and establishing operations on Bougainville (an autonomous region of PNG).

PNG – LNG supplier to Asia

Morumbi, through Rockwell, is focusing its review on oil and gas opportunities in what is still considered to be an underexplored and underdeveloped hydrocarbon rich country. PNG is poised to become a major liquefied natural gas ("LNG") supplier to nearby Asian markets with first deliveries set for 2014. Exxon Mobil, on behalf of a consortium, is constructing a $15 billion liquefied gas project of two "trains" to supply 6.9 million tons a year under contract to Japan, China and South Korea. Gas reserves of 13 tcf in the PNG Highlands were identified 20 years ago and have until now been shut in.

There has been little exploration for gas in PNG since that time. Favourable PNG fiscal policies, potential size and quality of resource, location and the demand loads required for LNG post- earthquake Japan is driving PNG activity. Exxon, its partners and others are now exploring for additional reserves to supply a proposed third LNG train.

Mineral Resources – EL 1767

Upon completion of the acquisition of Rockwell, Morumbi also acquired two mineral claims whose potential it is evaluating. In order to do so, Morumbi is assembling a technical operations team to carry out an exploration program on one of the claims, being EL 1767, a 34,100 ha mineral Exploration Licence on the North Slope of the Owen Stanley Range in Popondetta, PNG. The exploration program for EL 1767 is designed to build on prior work completed by Rockwell in 2008 including mapping, stream sediment sampling, ridge soil sampling and trench sampling. Although the prior program covered less than 10% of the concession, it identified two gold/copper prospects (Uko and Aime Creek). The current program is designed to identify potential porphyry targets for airborne magnetics, a 3D-IP survey and drill targets. This programme is expected to start in July. Of note, on two boundaries in surrounding licences intense advanced exploration activity is underway targeting large scale (greater than 2 million ounces gold equivalent) gold and / or copper resources.

PNG is noted for superior mineral geological prospectivity with several established world class gold and gold-copper deposits. Among the best examples along these prospective Neogene magmatic belts are the giant Grasberg Cu-Au porphyry-skarn district (204.67 Moz Au and 64.7 billion lbs Cu), OK Tedi (15.57 Moz Au and 46.3 billion lbs Cu), Porgera (24.53 Moz Au) and Lihir (46.1 Moz Au). Harmony Gold of South Africa recently announced the discovery of a 35 million ounce equivalent gold/copper/silver resource at Wafi-Golpu on the North side of the Owen Stanley range.


Morumbi is pleased to announce that it is moving aggressively to partner with landowners in Bougainville.

The island is one of the world's best endowed gold and copper districts and has excellent potential for the discovery of additional world class gold-copper deposits. It is host to the Panguna Mine which has in excess of 33 million ounces of gold equivalent resources (See Bougainville Copper Limited Press Release dated 11 February 2009). Despite the significant potential for resource exploitation in a region with a zero-based economy, Bougainville has been under an exploration moratorium since 1974 in the immediate area surrounding Panguna and over the rest of the Island since 1963.

Panguna which opened in 1972 was forcibly closed by a landowner uprising in 1989 leading to a civil war between Bougainville and PNG. The current metals super-cycle is driving political momentum towards lifting the moratorium and the resumption for full scale mineral exploration and development on the 10,000 sq km island.

Rockwell has unique relationships and an established presence on Bougainville and is at the forefront to be a leading participant in the eventual resumption of mining exploration on Bougainville.

If a target is identified through this process, completion of the acquisition could represent a Change of Business under the TSX Venture Exchange policies. As a result, any such transaction would be subject to a number of conditions, including TSX Venture Exchange acceptance and if required shareholder approval.

About Morumbi

Morumbi Oil & Gas Inc. is a public company with attractive near-term light oil exploitation opportunities in northwest Alberta, and, through its recent acquisition of Rockwell, it is actively undertaking programs to develop existing assets and conducting activities to acquire additional high impact Oil/Gas and Mineral assets. The Company trades on the TSX Venture Exchange under the symbol "MOC". For more information about Morumbi and the Company's McKinley Property and plans visit our website at


Certain statements contained in this news release may contain forward-looking information within the meaning of Canadian securities laws. Such forward-looking information is identified by words such as "estimates", "intends", "expects", "believes", "may", "will" and include, without limitation, statements regarding the company's plan of business operations (including plans for developing assets) and projected expenditures. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, commodity prices, risks inherent in the oil & gas industry, financing risks, labour risks, title disputes, regulatory risks, currency fluctuations, competition, unexpected decline rates in wells, changes in taxation or royalty regimes and environmental concerns. Most of these factors are outside the control of the company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the company expressly disclaims any intent or obligation to update publicly forward looking information, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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